Analysts expect Tesla’s cash to fall to $5.3 billion by the end of the second quarter, struggling to sustain two more quarters

Tesla, the electric car maker, is in a less-than-optimistic position, with the Fremont plant, which is undergoing the build-up of model 3 and other electric vehicles, shutting down production after the End of March 23, suspending production of electric vehicles and a date for a recovery date that is uncertain.

The Fremont plant, Tesla’s main electric vehicle plant, which is currently the company’s main electric vehicle unit, is the largest producer of the Model S, Model X, Model 3 and Model Y, and it is now Tesla’s largest production, stopping production of electric vehicles, which would have a huge impact on Tesla if it continued for a long time. The first impact is on the production and delivery of electric vehicles, which in turn affects financial indicators such as revenue.

Analysts expect Tesla's cash to fall to $5.3 billion by the end of the second quarter, struggling to sustain two more quarters

Analysts are also looking at the impact of the Fremont plant on Tesla, with Citi analyst Itay Michaeli among them among those who have already cut their target prices.

Mikaeli now expects Tesla to deliver about 434,000 electric vehicles this year, below its previous estimate of 517,000 and below Tesla’s previous estimate of 500,000, lower than Tesla’s target price of $246 from $312.

Mr. Mikaelsaid said the latest sales expectations reflect a major outage at Tesla’s Fremont plant, which is expected to begin a gradual recovery in the third quarter and fully recover in the fourth quarter.

On a financial front, Mr. Mikael expects Tesla to report adjusted losses in the first and second quarters, return to a slightly above breakeven level in the third quarter and return to profit ability in the fourth quarter.

On the liquidity front, Mr. Mikael said the $2.3 billion recently raised by Tesla provided an important cushion for Tesla’s likely operating losses and loss of working capital in the second quarter.

Mr. Mikaelexpecti expects Tesla’s cash to fall to $5.3 billion by the end of the second quarter, which means Tesla has enough cushions to deal with the difficulties that may arise in the second quarter, but its ability to respond to the buffer is relatively limited if there are two more quarters of similar conditions.